Exhibit 10.6
ESCROW AGREEMENT
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ESCROW AGREEMENT, dated ____ __, 1997, among XXXXX INTERNATIONAL, INC.,
a Delaware corporation ("Xxxxx"), Xxxxxxx Hemlock ("MH"), Xxxxxx X. Hemlock
("AJH") and Xxxx X. Hemlock ("LCH"); MH, AJH and LCH are sometimes referred to
collectively as the "Sellers"), and [_________], a New York corporation, as
escrow agent (the "Escrow Agent").
1. Agreement and Plan of Merger; Stock Purchase Agreement. This
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Escrow Agreement is made in connection with the Agreement and Plan of Merger,
dated as of March 1, 1997 (the "Merger Agreement"), among Xxxxx, Manhattan
International Limousine Network Ltd. ("MILN"), MILN Acquisition Corporation
("Acquisition") and MH, pursuant to which Acquisition is to be merged into MILN,
with the result that MILN will survive the Merger and become a wholly-owned
subsidiary of Xxxxx (the "Merger"), and the shares of Common Stock, par value
$.01 per share, of MILN outstanding immediately prior to the Effective Date (as
defined in the Merger Agreement) of the Merger will be converted into the Merger
Consideration (as defined in the Merger Agreement), which includes, without
limitation, the right to receive the number of whole shares of Common Stock, par
value $.01 per share, of Xxxxx determined by dividing
$2,400,000 million by the IPO Price (as defined in the Merger Agreement)(the
"Xxxxx Aggregate Shares") and $380,000 principal value of Xxxxx'x Promissory
Note (the "Xxxxx-XXXX Note"), in addition to a $60,000 cash deposit delivered to
MH upon the execution of the Merger Agreement, and (ii) the Stock Purchase
Agreement, dated as of March 1, 1997 (the "Stock Purchase Agreement"), among
Xxxxx, AJH and LCH, pursuant to which Xxxxx is purchasing all of the issued and
outstanding shares of International Limousine Network Ltd. for consideration
consisting of $6,760,000 in cash and $4,360,000 principal amount of Xxxxx'x
Promissory Note (the "Carey-ILN Note"), in addition to a $240,000 cash deposit
delivered to AJH and LCH upon execution of the Stock Purchase Agreement.
2. Purpose. This Escrow Agreement is entered into in accordance with the
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provisions of the Merger Agreement and the Stock Purchase Agreement to meet
Xxxxx'x requirements for indemnification thereunder.
3. Escrow Agent. The Escrow Agent accepts appointment hereunder and
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agrees to hold in escrow the Escrow Deposit (as such term is defined in Section
4) in accordance with the terms of this Escrow Agreement.
4. Escrow Deposit.
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4.1. On the Closing Date. In accordance with the
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provisions of the Merger Agreement and the Stock Purchase Agreement, Xxxxx will
deliver to the Escrow Agent on the date of the closing thereunder (the "Closing
Date") the number of Xxxxx Aggregate Shares equal to $2 million divided by the
IPO Price (the "Xxxxx Shares") (registered in the name of the Escrow Agent) and
$3 million in principal amount of the Carey-ILN Note (payable to the Escrow
Agent as escrow agent), provided that (i) in the event that Xxxxx does not issue
the Carey-ILN Note, electing to pay such amount of the consideration in cash,
Xxxxx will deliver to the Escrow Agent on the Closing Date next day funds
payable to the Escrow Agent, as escrow agent, in the amount of $3 million and
(ii) in the event that Xxxxx does not issue the Xxxxx Shares, electing to pay
such consideration in a promissory note in the principal amount of $2 million
(the "Replacement Note") or an equal amount of cash, Xxxxx will deliver to the
Escrow Agent on the Closing Date such Replacement Note or a next day funds
payable to the Escrow Agent, as escrow agent, in such amount; provided, that if,
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pursuant to the Stock Purchase Agreement, Xxxxx is required to deliver the cash
consideration thereunder payable at the Closing thereunder by wire transfer, the
cash payments set forth in this Section 4.1 shall be made by wire transfer of
funds to the account designated by the Escrow Agent.
4.2. Additions to the Escrow Deposit. Section 9 contemplates
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that, if the Xxxxx Shares are not sold prior to the first anniversary of the
Closing Date, they will continue to
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be held in escrow hereunder. It is the intention of the parties that the amount
held in escrow during the second year after the Closing Date not be affected by
the market price of the Xxxxx Shares. Accordingly, on the first anniversary of
the date hereof and every three months thereafter, so long as the Escrow Agent
continues to hold the Escrow Deposit hereunder, the Escrow Agent will calculate
the value of the Xxxxx Shares held in escrow based on the latest available
closing price thereof (ignoring whether resale of the Xxxxx Shares is restricted
by contract or under the securities laws). If such value is less than the value
of the Xxxxx Shares held in escrow valued at the IPO Price of $________ per
share (the amount of such difference, the "Deficiency"), MH will deposit with
the Escrow Agent, to be held as a portion of the Escrow Deposit hereunder, such
number of Xxxxx Shares, valued at such market price, as shall be equal in value
to the Deficiency or cash in the amount of the Deficiency. If such value is more
than the value of the Xxxxx Shares then held in escrow valued at the IPO Price
(the amount of such difference, the "Surplus"), the Escrow Agent will distribute
to MH such number of Xxxxx Shares, valued at such market price, as shall be
equal in value to the Surplus.
4.3. Allocation of Escrow Deposit. The Xxxxx Shares and the
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Carey-ILN Note, or their respective equivalents as described in Section 4.1 (the
"Escrow Deposit") shall be allocated as follows:
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(a) To MH, the Xxxxx Shares, or if they are sold, the amount of cash
proceeds from such sale held hereunder or the Replacement Note (or
cash in lieu thereof).
(b) To AJH, $1.5 million in principal amount of the Carey-ILN Note or
an equal amount of cash if the Carey-ILN Note is not issued or is paid
off.
(c) To LCH, $1.5 million in principal amount of the Carey-ILN Note or
an equal amount of cash if the Carey-ILN Note is not issued or is paid
off.
Any earnings thereon shall be allocated, (a) if from the Xxxxx Shares, the
Replacement Note or the proceeds thereof, to MH; and (b) if from the Carey-ILN
Note or cash received in lieu thereof or on payment thereof, to each of AJH and
LCH in proportion to their respective interests as shown above.
5. Seller Representative.
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5.1. Designation. MH, AJH and LCH have designated AJH to act as the
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representative of the Sellers hereunder (the "Seller Representative").
5.2. Replacement. In the event of the death, resignation or
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incapacity of AJH as Seller Representative, the Sellers or their heirs,
administrators, executors and assigns having a majority in interest at the time
in the Escrow Deposit will designate another person (who need not be one
of the
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Sellers) as Seller Representative.
5.3. Power to Act. AJH, as Seller Representative, and any successor
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Seller Representative shall have the powers and duties set forth in this Escrow
Agreement including the power to give all instructions and make all decisions
hereunder on behalf of the Sellers.
6. Investment of Escrow Deposit.
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6.1. Investments. The Escrow Agent will hold (i) the Xxxxx Shares
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until sold at the direction of the Seller Representative or released in
accordance with the provisions hereof and (ii) the Carey-ILN Note and
Replacement Note until the principal thereof is paid or the Carey-ILN Note and
Replacement Note or the proceeds thereof are released pursuant to the provisions
hereof. With respect to any amount of the Escrow Deposit that is comprised of
cash (whether because Xxxxx elects to deliver cash instead of the Carey-ILN Note
or Replacement Note, payment of the principal of the Carey-ILN Note or
Replacement Note or sale of the Xxxxx Shares), the Escrow Agent will, at the
direction of the Seller Representative, invest and reinvest the Escrow Deposit
and the income therefrom in any of the following: (a) readily marketable direct
obligations of the United States or readily marketable obligations for which the
full faith and credit of the United States are pledged to provide for the
payment of the principal thereof and interest thereon and
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which, in each case, by their terms mature less than one year from the date of
acquisition thereof, (b) certificates of deposit or bankers' acceptances of any
commercial bank organized and existing under the laws of the United States or
any State thereof or the District of Columbia having a capital and surplus
aggregating not less than $500,000,000 (which commercial bank may be the Escrow
Agent) which by their terms mature less than one year from the date of
acquisition thereof, (c) commercial paper maturing no more than 270 days from
the date of creation thereof and currently having the highest rating obtainable
from either Standard & Poor's Corporation or Xxxxx'x Investors Service, Inc.,
(d) repurchase agreements of commercial banks meeting the qualifications set
forth in subdivision (c) above in respect of the obligations of the types
described in subdivisions (a), (b) or (c) above and obligating such commercial
banks to repurchase such obligations not later than 90 days after the purchase
thereof or (e) such other obligations, certificates of deposit, bankers'
acceptances, commercial paper, repurchase agreements or other instruments as the
Seller Representative may select and Xxxxx may in its sole discretion approve
(such obligations, certificates of deposit, bankers' acceptances, commercial
paper, repurchase agreements and other instruments in which investments shall
have been made pursuant to subdivisions (a) through (d), (together with the
Xxxxx Shares, the Carey-ILN Note and the Replacement Note, "Investments").
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6.2. Sales of Investments. The Escrow Agent shall sell Investments
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(other than the Carey-ILN Note and the Replacement Note), (a) if requested by
the Seller Representative or (b) upon receipt of a written request from Xxxxx
but, in the case of such a request from Xxxxx, only to the extent that funds are
required to make payments pursuant to Sections 7.2, and 7.3. The Escrow Agent
shall not be responsible for any loss due to fluctuating market rates or the
value of the Xxxxx Shares.
6.3. Reports. The Escrow Agent shall deliver to Xxxxx and the Seller
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Representative, as promptly as practicable after the end of each calendar year
and in any case prior to February 28th of the following calendar year, a
statement setting forth the Investments and other property or funds held
hereunder as of, and the income collected from all Investments during the 12-
month period ending December 31st of such year.
6.4. Xxxxx Shares. The Escrow Agent will forward to the Seller
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Representative all annual and quarterly reports, proxy statements and other
documents it may receive with respect to the Xxxxx Shares and will vote the
Xxxxx Shares, with respect to any matters as to which the shareholders of Xxxxx
are entitled to vote, in accordance with such instructions as it may receive
from the Seller Representative. Absent such instructions, the Escrow Agent
shall not vote the Xxxxx Shares.
7. Claims.
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7.1. Request for Payment. In the event that Xxxxx shall claim
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indemnification under Section 6 of the Merger Agreement or Section 6 of the
Stock Purchase Agreement for Damages (as such term is defined therein), Xxxxx
shall give notice (a "Request for Payment") thereof to the Escrow Agent and the
Seller Representative, setting forth (a) a brief description of the nature of
and basis for such claim, (b) whether such Damages are consequent to a Third-
Party Claim (as such term is defined in Section 6.3 of the Merger Agreement and
Section 6.3 of the Stock Purchase Agreement) and if so, identifying such Third-
Party Claim, (c) the amount of the Damages, (d) any applicable reduction of the
indemnification payable with respect to such Damages pursuant to the provisions
of Section 6 of the Merger Agreement or Section 6 of the Stock Purchase
Agreement (if such reduction is known to Xxxxx at the time of the Request for
Payment) and (e) the net amount (the "Net Claim") for which indemnification is
claimed (if different than the amount of the Damages) and identifying whether
the claim is made under the Merger Agreement, the Stock Purchase Agreement or
both. No payment to Xxxxx under this Escrow Agreement shall be made with respect
to any Request for Payment received after the second anniversary of the Closing
Date unless such Request for Payment states that the Damages for which
indemnification is claimed is consequent to a Third-Party Claim and that Xxxxx
delivered timely initial written notice of such Third-Party Claim to the Seller
Representative pursuant to the provisions of Sections 6.2(a) and
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6.3 of the Merger Agreement or Section 6.2(a) and 6.3 of the Stock Purchase
Agreement. Xxxxx may amend a Request for Payment so as to increase or decrease
the amount of the Net Claim but unless such Request for Payment is for Damages
consequent to a Third-Party Claim, any such amendment must be delivered by Xxxxx
to the Escrow Agent and the Seller Representative prior to the second
anniversary at the Closing Date.
7.2. Payment of Claims. The Escrow Agent will transfer to Xxxxx out
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of the principal of the Escrow Deposit the amount of the Net Claim stated in any
Request for Payment (or, in the case of a Net Claim stated in an amended Request
for Payment, the amount of the Net Claim less any amount previously transferred
to Xxxxx with respect thereto) 10 business days after delivery thereof unless
the Seller Representative shall have delivered a notice of objection (a "Notice
of Objection") to Xxxxx and the Escrow Agent, stating the amount, if any, of the
Net Claim that the Sellers do not contest; provided, however, that the Escrow
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Agent shall pay Xxxxx any amount of the Net Claim which the Seller
Representative does not contest in its Notice of Objection. Upon receipt of a
Notice of Objection to a Request for Payment or amended Request for Payment, the
Escrow Agent will make no distribution to Xxxxx with respect to the contested
amount of the Net Claim until it has received either (i) a certificate executed
by Xxxxx and the Seller Representative setting forth the amount of the Net Claim
as agreed to by Xxxxx
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and the Seller Representative or (ii) if the issue has been submitted to
arbitration pursuant to Section 10, a copy of the arbitral award delivered by
the American Arbitration Association ("AAA") in accordance with Section 10
setting forth a finding as to the amount of the Net Claim, whereupon the Escrow
Agent will promptly transfer to Xxxxx the amount of the Net Claim stated in such
award, less any prior distribution of the uncontested portion thereof. If, after
payment of the Net Claim stated in a Request for Payment, Xxxxx files an amended
Request for Payment reducing the amount of the Net Claim, Xxxxx will refund to
the Escrow Agent the excess of the amount received over such Net Claim (as so
amended), together with interest from the date it received such excess through
the date of refund at the rate of eight percent per annum and the Escrow Agent
will credit such refund to the principal of the Escrow Deposit and such interest
shall be paid to the Seller Representative who shall allocate it among the
Sellers. If a Notice of Objection to payment of a Net Claim stated in any
Request for Payment results in a delay in the payment made by the Escrow Agent
to Xxxxx and if the Notice of Objection does not lead to a reduction in the
amount paid to Xxxxx from that stated in the Request for Payment or a reduction
of less than fifty percent in the amount contested in the Notice of Objection,
the Escrow Agent will also pay Xxxxx from the principal of the Escrow Deposit,
interest at the rate of eight percent per annum from the date payment would have
been made absent such Notice of Objection. If the Notice of Objection
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leads to a reduction of fifty percent or more in the amount paid to Xxxxx from
that the amount contested in the Notice of Objection, the Escrow Agent will pay
Xxxxx interest from the date payment would have been made absent such Notice of
Objection at a rate equal to the average rate of income received on the Escrow
Deposit as a whole during such period.
7.3. Allocation of Indemnification Payments. Any payment made
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pursuant to Section 7.1 shall be made first from any principal cash included in
the Escrow Deposit, next from the principal balance of the Carey-ILN Note and
Replacement Note (and Xxxxx agrees to issue a new Carey-ILN Note and Replacement
Note in the principal amount of such prior principal balance, less any such
payment allocated to the Carey-ILN Note and Replacement Note) and finally from
the Xxxxx Shares, valuing such shares at the latest available closing price
thereof (disregarding for this purpose whether the Xxxxx Shares may be sold
freely or are subject to restrictions on resale whether under the Merger
Agreement, the agreements contemplated thereby, or by law) on the business day
immediately prior to the date payment is made. To the extent that
indemnification payments are made from the Xxxxx Shares, Xxxxx may direct the
Escrow Agent to make such payments either (i) in Xxxxx Shares or (ii) in cash
proceeds from the sale of Xxxxx Shares.
8. Distributions of Income. As promptly as
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practicable after the end of each calendar month, the Escrow Agent shall
distribute to (a) to MH any dividends received on the Xxxxx Shares and any
income from Investments made with the proceeds of the Xxxxx Shares and (b) to
AJH and LCH, in proportion to their interests as stated in Section 4.2, any
interest payments received on the Carey-ILN Note or on any Investments made from
cash received in lieu of or upon payment of the Carey-ILN Note.
9. Distributions of Principal. (a) This Escrow Agreement
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contemplates that, subject to the provisions of Section 7, the principal balance
of the Escrow Deposit be distributed to MH, AJH and LCH as follows:
(i) If Xxxxx Shares are sold before the first anniversary of the
date hereof, any proceeds of such sale exceeding the Adjusted First Year
Minimum Escrow Balance (as determined on the date of such sale) will be
distributed to MH. "Adjusted First Year Minimum Escrow Balance" means, with
respect to the Escrow Deposit an aggregate principal balance or fair market
value, as the case may be, of $5 million, less any amounts paid to Xxxxx
before the first anniversary of the date hereof.
(ii) On the first anniversary of the date hereof, the principal
balance of the Carey-ILN Note will be delivered to AJH and LCH in
proportion to their
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interests as stated in Section 4.2.
(iii) If Xxxxx Shares are sold between the first and second
anniversaries of the date hereof, any proceeds of such sale exceeding the
Adjusted Second Year Escrow Balance (as determined on the date of such
sale) will be distributed to MH. "Adjusted Second Year Minimum Escrow
Balance" means, with respect to the Escrow Deposit, an aggregate principal
balance or fair market value, as the case may be, of $2 million, less any
amounts paid to Xxxxx before the second anniversary of the date hereof.
(iv) On the second anniversary of the date hereof, the remaining
principal balance of the Escrow Deposit will be distributed to MH.
The distributions contemplated by subdivisions (a)(ii) and (a)(iv) shall be made
by the Escrow Agent on the dates shown above, less any amount as to which Xxxxx
shall notify the Escrow Agent is required to satisfy any pending claims for
Damages ("Pending Claims"), the amount of which has not been finally determined
as of the date of such scheduled distribution (the "Retention Amount"). Any
distributions pursuant to subdivision (a)(i) and (a)(iii) above shall be made by
the Escrow Agent immediately upon receipt of the funds from the sale of the
Xxxxx Shares. If Xxxxx believes that a Retention Amount should be retained to
satisfy Pending Claims, it shall deliver to the Escrow Agent and the Seller
Representative a notice thereof (the
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"Retention Notice"), stating the Retention Amount Xxxxx believes should be
retained. If the Escrow Agent shall not have received a Retention Notice prior
to the scheduled date of such distribution, it shall promptly make the
distribution in accordance with the provisions hereof. If the Escrow Agent shall
have received a Retention Notice from Xxxxx, the Escrow Agent will deduct from
the distribution otherwise to be made hereunder the Retention Amount set forth
in the Retention Notice of Xxxxx.
If the Seller Representative does not agree with the Retention Amount stated
in the Retention Notice of Xxxxx, he shall, within 10 business days of delivery
of the Retention Notice of Xxxxx, deliver a Notice of Objection thereto to Xxxxx
and the Escrow Agent, but the Escrow Agent shall continue to hold the Retention
Amount stated in such Retention Notice. Upon receipt of a written agreement
executed by Xxxxx and the Seller Representative as to the Retention Amount to be
thus retained or, if Xxxxx and the Seller Representative are unable to reach
such agreement and the issue is submitted to arbitration pursuant to Section 10,
upon receipt of a copy of the arbitral award adjudicating such issue delivered
by AAA in accordance with Section 10, the Escrow Agent will deduct from the
distribution otherwise to be made hereunder the Retention Amount determined in
accordance with such agreement or award. Any amount not so distributed shall
continue to be held by the Escrow Agent and be subject to the provisions of this
Escrow Agreement. The amount of the principal of the Escrow Deposit retained
subsequent to when it would have
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otherwise been distributed pursuant to the provisions of this Section 9 may be
reduced as Pending Claims are satisfied or otherwise extinguished and either
Xxxxx or the Seller Representative, by notice delivered to the other and to the
Escrow Agent, may from time to time direct the Escrow Agent to distribute to the
appropriate Seller any part or all of such retained principal, which the Escrow
Agent will do unless it receives within 10 business days of delivery of such
direction a Notice of Objection to such direction, in which case it will refrain
from making such a distribution until it has received an agreement executed by
Xxxxx and the Seller Representative as to the amount to be so distributed or, if
Xxxxx and the Seller Representative are unable to reach such agreement and the
issue has been submitted to arbitration pursuant to Section 10, a copy of the
arbitral award delivered by AAA in accordance with Section 10 stating the amount
to be so distributed certified or otherwise identified to the satisfaction of
the Escrow Agent. The Escrow Agent may, at any time after the second anniversary
of the Closing Date, request Xxxxx and the Seller Representative to give it
instructions as to the disposition of the principal of the Escrow Deposit and
unless directed in writing by either Xxxxx or the Seller Representative to
continue to hold such principal pursuant to the terms of this Escrow Agreement,
shall distribute the remaining principal in accordance with the provisions of
this Section 9.
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10. Arbitration. Any dispute arising under or relating to this
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Escrow Agreement, including without limitation the resolution of any issues
raised by any Notice of Objection delivered pursuant to the provisions of this
Escrow Agreement, shall be finally settled by arbitration conducted
expeditiously in accordance with the then existing Commercial Arbitration Rules
of the American Arbitration Association. The arbitration shall be held in New
York, New York before a single arbitrator unless the amount in controversy
exceeds $500,000, in which case Xxxxx or the Seller Representative may require
that the arbitration be held before three arbitrators. The arbitration shall
begin within ninety (90) days of the initiating party's notice of its intent to
arbitrate unless the parties agree in writing to an extension. The fees and
expenses of the arbitration shall be borne equally by Xxxxx and the Sellers. All
other costs and expenses incurred in connection with the arbitration (including
fees and expenses of counsel) shall be borne by the party incurring such
expenses. The award shall be issued within thirty (30) days after the conclusion
of the arbitration proceedings. The award shall be in writing, and shall be
delivered promptly (i) by the arbitrator to AAA and (ii) by AAA simultaneously
to Xxxxx, the Seller Representative and the Escrow Agent.
11. Responsibilities of Escrow Agent. The Escrow Agent's acceptance
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of its duties under this agreement is subject to the following terms and
conditions which the parties hereto
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agree shall govern and control with respect to the rights, duties, liabilities
and immunities of the Escrow Agent:
(1) Anything herein contained to the contrary notwithstanding, the
Escrow Agent shall not be obligated to take any action which might in its
reasonable judgment involve it in any expense or liability unless furnished
with reasonable indemnity.
(2) In making any payment or taking any other action hereunder, the
Escrow Agent may rely and shall be protected in acting or refraining from
acting upon any certificate, opinion, consent or other document believed by
it to be genuine and to have been executed or presented by the proper party
or parties. The Escrow Agent may perform any of the duties provided for
herein either directly or through agents or attorneys and be protected from
any liability in acting, in the absence of bad faith, upon the advice of
attorneys and accountants.
(3) The Escrow Agent shall not be liable for any action taken in
accordance with instructions, requests or directions it is required to
follow under any provision of this Escrow Agreement or otherwise authorized
or within the rights and powers conferred upon it by this Escrow Agreement,
except that nothing contained herein shall relieve the Escrow Agent from
liability for its own negligence or wilful misconduct.
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(4) The Escrow Agent undertakes to perform such duties and only such
duties as are specifically set forth in this Escrow Agreement and no
implied covenants or obligations shall be read into this Escrow Agreement,
or the Merger Agreement or the Stock Purchase Agreement against the Escrow
Agent, nor shall the Escrow Agent have any responsibility to inquire into
the validity or enforceability of any agreement made or entered into in
connection with this Escrow Agreement including but not limited to the
Merger Agreement and the Stock Purchase Agreement.
(5) Xxxxx and the Sellers hereby agree, jointly and severally, to
indemnify the Escrow Agent for, and to hold it harmless against, any loss,
liability or reasonable out of pocket expense incurred without negligence
or bad faith on the part of the Escrow Agent, arising out of or in
connection with its entering into this Escrow Agreement and carrying out
its duties hereunder, including the cost and expenses of defending itself
against any claim of liability.
(6) Moneys received by the Escrow Agent hereunder need not be
segregated in any manner except to the extent required by law and may be
deposited under such general conditions as may be prescribed by law in the
general banking department of the Escrow Agent, and the Escrow Agent shall
not be liable for any interest
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thereon.
(7) The Escrow Agent makes no representation as to and has no
responsibility for the validity or sufficiency of this Escrow Agreement,
except that the Escrow Agent represents and warrants that its acceptance of
its duties hereunder has been duly and validly authorized by all necessary
corporate or other action and that this Escrow Agreement is valid and
binding in respect of the Escrow Agent in accordance with its terms.
12. Resignation of Escrow Agent; Appointment of Successor. The
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Escrow Agent acting at any time hereunder may resign at any time by giving
thirty days' prior written notice of resignation to Xxxxx and the Seller
Representative, such resignation to be effective on the date specified in such
notice. The resigning Escrow Agent may appoint by written instrument delivered
to such successor Escrow Agent, Xxxxx and the Seller Representative, or failing
such appointment, Xxxxx and the Seller Representative shall appoint, a bank or
trust company with a combined capital and surplus of at least $500,000,000 as
successor Escrow Agent, whereupon such successor Escrow Agent shall succeed to
all the rights and obligations of the retiring Escrow Agent as of the effective
date of resignation as if originally named herein and the retiring Escrow Agent
shall duly transfer and deliver the Escrow Deposit and other property at the
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time held by the retiring Escrow Agent, provided that if no successor Escrow
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Agent shall have been appointed on the effective date of resignation of the
resigning Escrow Agent hereunder, the resigning Escrow Agent may pay the Escrow
Deposit into a court of competent jurisdiction.
13. Fees and Expenses of Escrow Agent. Xxxxx and the Seller
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Representative hereby agree to pay the Escrow Agent reasonable compensation for
the services to be rendered hereunder and to reimburse the Escrow Agent upon
request for all expenses, disbursements, and advances, including reasonable
attorneys' fees, incurred or made by it in connection with carrying out its
duties hereunder. Xxxxx will pay one-half of such fee and expenses. At the
direction of the Seller Representative, the Escrow Agent shall pay such
compensation, expenses, reimbursements and advances, or reimburse the Seller
Representative for his prior payment thereof, from the income or the principal
of the Escrow Deposit.
14. Notices. All notices and other communications hereunder shall be
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in writing and shall be delivered or mailed by first-class registered or
certified mail, postage prepaid, return receipt requested, addressed as follows:
(a) if to Xxxxx, at:
Xxxxx International, Inc.
0000 Xxxxxxxxx Xxxxxx X.X.
Xxxxxxxxxx, X.X. 00000
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Attention: Xxxxxxx X. Xxxxxxxxxx
Chairman and Chief Executive
Officer
with a copy to:
Xxxxxx, XxXxxxxxx & Fish, LLP
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
or at such other address as Xxxxx shall have furnished the Seller Representative
and the Escrow Agent in writing;
(b) if to the Seller Representative, to
Xx. Xxxxxx X. Hemlock
000 Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
with a copy to:
Patterson, Belknap, Xxxx & Xxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx, Esq.
or at such other address as the Seller Representative shall have furnished Xxxxx
and the Escrow Agent in writing; or
(c) if to the Escrow Agent, to:
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or at such other address as the Escrow Agent shall have furnished Xxxxx and the
Seller Representative in writing.
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15. Governing Law. This Escrow Agreement shall be construed in
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accordance with and governed by the laws of the State of New York.
16. Miscellaneous. This Escrow Agreement may be amended only by an
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instrument in writing signed by Xxxxx, the Escrow Agent and the Seller
Representative. This Escrow Agreement may be waived, discharged or terminated
only by an instrument in writing signed by the Escrow Agent and the party
against which such change, waiver, discharge or termination is sought. This
Escrow Agreement shall be binding upon and inure to the benefit of the parties
and their respective successors and assigns. The headings in this Escrow
Agreement are for convenience of reference only and shall not define or limit
the provisions hereof. This Escrow Agreement may be executed in several
counterparts, each of which is an original but all of which together shall
constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Escrow
Agreement to be executed as of the date first above written.
XXXXX INTERNATIONAL, INC.
By:
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Title:
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Xxxxxxx Hemlock
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Xxxxxx X. Hemlock
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Xxxx X. Hemlock
, as Escrow
----------------- Agent
By:
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Title:
24
